Intercompany reconciliation rules in Planning Business Modeler

Intercompany (IC) reconciliation rules balance transactions that occur between different entities in the company. For example, if a company called MyGreatResorts owns a resort in Tahoe and another resort in Toronto, you can use IC reconciliation to balance the intercompany transactions between Tahoe and Toronto.

IC reconciliation is included with two types of standard models:

The financial model with shares calculations

The financial model without shares calculations

Note: You can run an IC reconciliation rule only from a financial mode. It is possible to add an IC reconciliation rule to another model, but not run the rule.

IC reconciliation adjusts for differences in the values that are recorded by the buyer entity and the seller entity for intercompany transactions. If, after adjustments for currency differences, the recorded values do not match, IC reconciliation creates balancing entries.

For example, suppose that the Tahoe resort sold supplies to the Toronto resort. If Tahoe (the seller) recorded $250 for the supplies sale, but Toronto (the buyer) recorded $200 for the same transaction, the transaction is $50.00 out of balance. To reconcile the difference between buyer and seller, IC reconciliation enters an adjustment in an offset account for the seller. In this case, the IC reconciliation process enters $50.00 in the Reconciliation Offset Account, therefore creating overall balance.